What would you do with €130K in savings as a 30 year old?

I am in a similar situation, have 50k in Irish Life MAPS but the returns have stagnated after 5 years so trying to decide between...

- Maximising AVC on an existing PRSA
- Maximise Mortgage Repayments (Currently 30 Years Remaining)
- Invest in ETF (VWCE)

I am contemplating ETF option with continuous monthly buy in, as I don't want the money locked into PRSA or property. Thinking a decent % return on ETF will out grow my mortgage (currently 2.2%).

If it was me at 30yo, I'd aim for:

60ish% Total world stock market (this can be split up further into regions but no need to add extra complexity at this stage)

20-30% cash (to be invested monthly into the above over the next 12-18 months until it's all invested or lump sum invested in the event of a big dip in the markets)

10-20% crypto (BTC, ETH should make up the bulk of this)

Mathematically you're better off not having any cash on the sidelines and investing it all right now, but keeping some to the side is easier psychologically. So long as you have a plan to regularly invest this cash portion and don't leave it out of the market. Also having cash has other perks (you can bargain with landlords for cheaper rent if you pay for a few months up front etc)

With this plan, if the market goes up: happy days, you have most of your money working for you and a solid plan to add the remaining amount over the next short while. If the market goes down, you get to take advantage of cheaper prices and your average cost per share will go down. This should help with your hesitations around getting the timing wrong.

Pension might be a good option if you're ok not having access to that money for another 30ish years but I'd probably stay away from that personally. I also wouldn't buy a house if you might end up moving in a few years anyway.

You seem to have the frugal lifestyle down already so you can probably afford to be a bit riskier than most with your investments at your age. Good luck with whatever you decide to do!

massdebater wrote: »

If it was me at 30yo, I'd aim for:

60ish% Total world stock market (this can be split up further into regions but no need to add extra complexity at this stage)

20-30% cash (to be invested monthly into the above over the next 12-18 months until it's all invested or lump sum invested in the event of a big dip in the markets)

10-20% crypto (BTC, ETH should make up the bulk of this)
!

Im in a similar boat, probably have 60k to invest. I have no idea about stocks and no desire to learn.

Any recommendations for a managed fund?

Max pension, and if you have a mortgage pay it off. That's two of the quickest ways to start accumulating wealth. Maximise that pension tax break.

After that with a lump sum investment:

ETF such as one from Vanguard or Investment Trusts.
Blue Chip portfolio.


I'd stay away from ETFs if it's regular savings.

I'd limit stocks paying dividends due to tax. I'd move into them at retirement if you have money to play with then.

Good luck.

Stark wrote: »

Be wary of the tax on ETFs , it's a nightmare. That's the big advantage of pension funds. They can invest in ETFs on your behalf and not worry about the tax. Though if you buy US domiciled ETFs, it's not so bad.

They are fine for lump sums if you leave them there accumulating.

A massive pain if you are making regular purchases. I've been advised against this sort of regular purchase by many tax experts.

HillCloudHop wrote: »

Sorry, I phrased this poorly. I have to move across the country and likely abroad every year for the next 5 years to progress in my career. Would it be a lot of hassle renting a property out and dealing with tenants in this case?

Well done on saving that amount.i hope you have also enjoyed some of your hard earned cash in your downtime.
If your not in a position for a set number of years check out the state saving certs via An Post. Best of returns. Best sacings return at the moment. Also looking into maximising your pension contributions.

Have to laugh at some people asuming if you saved loads in 20s you havent enjoyed life. In a previous job a woman started a thing about what salary was i on paying rent and always going on holidays, nights out, matches, gigs etc and she was always broke. Little did she know i was saving a nice bit too and had a deposit saved

Its taking time to sit down and work out a little financial management moving home wasnt an option. 1st off direct debit into a notice savings account on payday you wont miss the money and the few times i got a pay increase i upped the direct debit amount.
Make sure your tax credits are up to date esp if employers are paying you health insurance. Thats worth 200 a year. Claim any other tax refunds to you can ie med1 form for doctors visits etc. Last year the younger members of the team at work didnt know about this and i got refunds for a number of them when i explained it to them
Also if you have health insurance employer paid or otherwise make sure you read what day to day expense you can claim for ie physio, contact lenses etc
A revoult account and a bit of discipline is handy too. Any revenue or health refunds amounts into a vault. Always use loyality cards in dunnes, tesco boots and those saving also into the revoult vault...surprising how it adds up.supervaue card is handy if your a fan of online shopping. That vault had paid for many a ryanair flight.
Aldi and Lidl also become your friend.. Review your subscriptions regularly. Do you need to pay for netflix every month. For summer months i always cancelled it as i dont be home enough to get ful value for it. Same with mobile plan review regularly. Im not a massive drinker compared to when I was younger so sometimes I drive on a night out. Had a flatmate who loved travel wasnt on massive wages so she was great not running up bills etc. We use to often do taxi for each other on weekends. She was great at using adverts and done deal for selling stuff she no longer needed. Try to take your own lunch to work 2 or 3 days a week is another good saving. Often its the small thinga when they all add up make a difference

wfdrun wrote: »

clearly wrong?? can you evidence please

I mean if they have zero value they'd be "trading" for €0 no?

Sure stocks can be analysed by fundamentals but look at Tesla, a lot of it is hype. Crypto currencies have utility too.

Back to the OP, I'd like to add to be wary of maxing out pension as while it is tax free, drawing it down certainly isn't and you are pretty much locked out of it for the next 35 odd years. Would it be an idea to move funds to a country with more favourable investment taxation and let it grow there or move elsewhere all together?

Regarding investment property, it is a lot of work with and plenty of risk given the current legislation of not enforcing evictions and backpayment of rent (even outside of the covid eviction bans).

I would look into compounding investments in the long term plan of ideally living off dividends.

djan wrote: »

Would it be an idea to move funds to a country with more favourable investment taxation and let it grow there or move elsewhere all together?

Almost certain revenue will still want their share of this.
I've an ISA which is tax-free right now as I'm living in London and thinking about moving home and from what I can see they will want their share of this as long as your living in Ireland and are tax resident regardless of where the investment structure is based.

djan wrote: »

I wonder if this would be the case if you were to transfer funds abroad and let them compound there and never bring them or the gains back to Ireland.

What use is that to you then?
You've to realize the gains at some point or why bother saving at all and just blow it on hookers and drugs as suggested earlier and have some fun with it.

Only way this makes sense is if you move with the money and then realize it in a more tax efficient country when your no longer tax resident in Ireland.
But tbh for this amount of money I wouldn't think that'd be worth ripping up your life for.

I don't disagree that you can save and have a good time but realistically if you finish college at 22 and spend the next 8 years working a very well paid job earning 60k on average (being very generous) you are probably bringing home 35k a year after pension contributions. That's 280k in revenue so in this specific example if you've managed to save pretty much 50% of that and still enjoy yourself to the fullest that would definitely be a tough one to pull off, in my view it is unlikely that you did anything and everything you wanted to while you had the time and freedom.

Stark wrote:

Be wary of the tax on ETFs , it's a nightmare. That's the big advantage of pension funds. They can invest in ETFs on your behalf and not worry about the tax. Though if you buy US domiciled ETFs, it's not so bad.

Why? What's the issue? And how is it different to stocks?

I'm using the same platform/broker for both.

I would play safe:

-Avoid crypto!
-Invest upto 10% in well recognised multi national companies such as Google.
-Buy what you like and don't regret.
-Keep your savings securely.

Enjoy!

P.S. I am in the same age group with similar amount of savings.